How do you get the capital structures of the firm in market values? The answers are there but I need to know how.

9.) Examine the following book-value balance sheet for University Products, Inc. The preferred stock pays a $2 dividend and currently sells for $15 per share and the common stock for $20 per share. There are 1 million common shares outstanding. The common stock's beta is 0.80, the market risk premium is 10% and the risk-free rate is 6%. The tax rate is 40% BOOK VALUE BALANCE SHEET (all values in millions) Assets Liabilities and Net Worth Cash and short-term securities 1 Bonds, coupon = 8%, paid $10.0 annually (maturity 10 years, current yield to maturity. 9%) 3 Preferred stock (par value $20 2.0 per share) 7 Common stock (par value $.10) 21 Additional paid-in stockholders Plant and equipment 9.9 capital Retained earnings Total 10.0 $32.0 Total $32 a. What is the capital structure of the firm on the basis of market values? Solution: The market value of common equity = $20 x 1 million shares outstanding = $20 million We can infer the number of preferred shares outstanding: $2,000,000 book value / $20 par value per share 100,000 preferred shares outstanding The market value of preferred equity $15 per share x 100,000 shares outstanding $1.5 million The market value of debt FV 10,000,000 (the book value of debt) N-10 PMT = 8% (10,000,000) 800,000 (annual coupon) CPT PV = $9,358,234 (this is the market value of debt) The market value of debt: FV-10,000,000 (the book value of debt) N-10 PMT-8%(10,000,000)-800,000 (annual coupon) CPT PV = $9,358,234 (this is the market value of debt) Thus, the capital structure of the firm in market values is: Debt: Preferred equity: Common equity: Total capital: $9.358,234 $1,500,000 $20,000,000 $30,858,234 30.33% 4.86% 64.81% 100%